The Watchung Hills Regional budget for the 2013-2014 school year faced several challenges—including an increase in enrollment and several capital projects that could have proven to be budget busters.
But according to a presentation at Monday's Board of Education meeting by Business Administrator Timothy Stys, the district is expecting to meet its goals that include adding technology and improving student achievement with a budget that rises by 0.10 percent.
Of course, there is a caveat to the proposed budget: Stys said it assumes state aid remains at $902,393, the same as the current school year, and that may not be a safe assumption.
"Feb. 26, the governor speaks; Feb. 28, we get our state aid—I think you really need to pay attention because I'm thinking we're probably going to lose some state aid," he told the board. He said the word going around the state is that state aid—which was several million dollars until two years ago—may be cut in half.
The proposed operating budget ( doesn't include debt service and grants) totals $36,813,707, up $36,713 from the $36,776,994 budget for 2012-2013.
While the total budget increases by less than 1 percent, the tax levy is expected to increase by the maximum 2 percent allowed, from $27,099,498 to $27,641,488, largely due to less funds available in surplus accounts than the previous year (down from $2,250,168 to $780,615).
The declining surplus is a concern to board members because of a growing list of pending—and sometimes, impending—projects facing the school, including roof replacement work, replacement of broken exhaust fans required to make heating and cooling systems properly function, and replacing the turf field.
While those projects are looming on the horizon, a much closer cloud is the nearly 50-year-old steam heating system in the school's south building, which is expected to cost more than $2 million to replace.
"We've been advised the distribution system itself...is in disrepair and in need of replacement," board member Gerry Binder, head of the board's finance and operations committee, said. "Will we make it through this season? Yes, but next year..."
Since work on the heating system must be done in the summer, board members are scrambling to find a way to get the work done. State grants to help districts with major projects have ended, leaving few choices for financing other than borrowing—which will require voter approval on a referendum.
"It's like the perfect maintenance storm," board President Robert Horowitz said. He added most businesses look to spend about three to four percent of annual budgets on maintenance. "We just can't do that with our budget. All is all, it's a very difficult situation."
Stys told the board he is working to find a way to assure much of the $2 million needed for the steam system will be available, in the event the system breaks down (video).
Stys said estimates of the tax impacts of the budget aren't available because the Department of Education hasn't provided the breakdown of assessments needed for the three sending districts included in the tax assessment (Long Hill, Warren and Watchung).